Created by:
Fiona Brown
Partner
Aird Berlis
+1 416.865.3078
fbrown@airdberlis.com
Expanding Your Business to Canada
|
Category |
Question | Answer |
| Timing | How long does it take to incorporate? | Within 24 hours after we have the required information. Everything can be done electronically and signed via Docusign. |
|
SR&ED Credits |
Can I access SR&ED credits if I do not incorporate a Canadian entity? | No – SR&ED is only available to Canadian entities |
| Resident Canadian Director | Do I need a resident Canadian director to incorporate a Canadian company? |
No – on July 5, 2021, Ontario joined the provinces of Nova Scotia, Alberta, British Columbia and Quebec in the growing trend of no longer requiring provincially-incorporated business corporations to have at least one resident of Canada as a director. One no longer needs to look to the aforementioned provinces to incorporate the Canadian subsidiaries of foreign companies that have no resident Canadian directors. Instead one is able to incorporate them in Ontario |
| Federal vs. Provincial Incorporation | Does it make a big difference if I incorporate in B.C. instead of federally or in Ontario? | No – federal and provincial legislation relating to incorporations are substantially similar. A federally incorporated company requires at least 25% of a corporation’s directors to be either Canadian citizens or permanent residents ordinarily residing in Canada. |
| Type of Corporation | What type of corporation should I incorporate? | Two options: either a standard Canadian corporation or an unlimited liability corporation (ULC). Note that there are no C Corps, S Corps or LLCs in Canada |
| Bank Account | Do I need a bank account to incorporate? | No – and you don’t need to have any assets in Canada at the time of incorporation |
| Minimum Investment | Is there a minimum amount you have to invest in Canada in order to incorporate? | No – no minimum requirement |
| Employment | Are the employment laws substantially the same as in the United States? |
No – we don’t have at-will employment in Canada, so it’s critical to make sure you enter into a properly drafted employment agreement with any employees before they start. Service provides can offer Canadian employment agreements on a very cost-efficient basis |